Fashion chain Forever 21 investigated over 'sweatshop' working conditions that break minimum wage and overtime lawsLos Angeles-based chain is being investigated by The Labor Department, which has uncovered evidence of 'significant' violations of federal law

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UPDATED:

16:54 GMT, 30 October 2012

They are famed for their budget yet fashionable collections, but Forever 21’s cut-price business plan has been accused of creating ‘sweatshop-like’ conditions for their workers.

The Los Angeles-based fashion chain is being investigated by The Labor Department, which has so far revealed evidence of ‘significant’ violations of federal law.

Violations include breaches to minimum wage, overtime and record-keeping by contractors, manufacturers and vendors supplying goods to Forever 21, The US Department of Labor said in a statement.

Forever 21's flagship store opens in New York's Times Square in 2010

A news release has been issued detailing the recent investigation by the department’s Wage and Hour Division in the Southern California’s garment industry.

Dozens of vendors for Forever 21 have been under investigation since 2008, but were finally handed a subpoena in August this year after they refused to cooperate with the inquiry.

The agency wants their contractors and manufacturers’ hourly wage documentation, as well as workers’ hours and their employment practices.

Regional administrator for the department’s West division, Ruben Rosalez, said in the statement: ‘When companies like Forever 21 refuse to comply with subpoenas, they demonstrate a clear disregard for the law.

‘The Labor Department will use all enforcement tools available to recover workers’ wages and hold employers accountable.’

Meanwhile, the company itself issued their statement saying that Forever 21 ‘is surprised and disappointed that the department declined to meet before filing this action but looks forward to working with them to address any issues.’

The retailer, which has stores throughout America, is just one example of the widespread violations of minimum wage and hours in Southern California’s garment industry.

The Fair Labor Standards Act (FSLA) is cracking down on Los Angeles and Orange counties’ fashion districts and more than 1,500 investigations have been conducted in LA, San Diego and West Covina over the last five years.

Of those investigations, 93 per cent uncovered violations and the FSLA found over $11 million in wages back owed to 11,000 employees.

Federal minimum wage is $7.25 per hour, plus time and a half of regular rates for hours worked over 40 per week.